VII. PLEAS the action upon the general issue that the seed was wholly unproductive OF SET-OFF and worthless (s). But it has been held that negligence in the conduct [ *570 ] utes 2 G. 2. c. 22, s. 1 s, and 8 as to set of a cause, cannot be set up as a defence to an action on an attorney's bill; at least unless it was such negligence as to deprive the defendant of all possible benefit from the cause (). And if a consignee of goods accept any benefit from the carriage, he cannot defend himself from the payment of freight, on the ground that the goods have been damaged by the master in carrying them, although the damage exceed the amount of the freight (u). So, in an action by a servant against his master for wages, the latter cannot in general set off or deduct the value of goods lost or damaged by the negligence of the former, unless it can be proved to have been part of the original agreement between them that the servant should pay out of his wages, for all his master's goods lost through his negligence, in which case the value of the goods lost may, under the general issue, be deducted from the amount of the wages (x). Where by the custom of the hat trade, the amount of the injury sustained by the hats in the process of dyeing, is always to be deducted from the charge of dyeing, the defendant is entitled to such deduction, in an action brought by the dyer, without giving any notice of set-off and although there has not been any previous adjustment of the amount of the damage done (y). And it is a clear rule at common law that if a principal permit his factor to assume the apparent ownership of goods, and to sell them in his, the factor's own name, the vendee, who brought them in ignorance that the factor acted merely as an agent, may, to an action by the principal for the price, set off a debt due to him from the agent (~); and this defence may be given in evidence under the general issue, or specially pleaded in bar (a). But before the statutes of set-off, where there were cross demands unconnected with each other, a defendant could not in a court of law defeat the The stat action by establishing that the plaintiff was indebted to him even in a larger sum than that sought to be recovered, and relief could only be obtained in a Court of equity (b). To remedy this injustice, it was enacted by the 2 G. 2, c. 24, Geo. 2, c. 22, s. 13 (c), "that where there are mutual debts between the plaintiff and defendant, or if either party sue or be sued as executor or administrator, where there are mutual debts between the testator or intestate and either party, one debt may be set against the other; and such matter may be given in evidence upon the general issue, or pleaded in bar as the nature of the case shall require, so as at the time of his pleading the general issue, where any such debt of the plaintiff, his testator or intestate, is intended to be insisted on in evidence, notice shall be given of the particular sum or debt so intended to be insisted on, and upon what account it became due, or otherwise such matter shall not be allowed in evidence (s) 9 B. & C. 259; 4 Man & Ry. 208, S. C. (t) 2 New R. 136; 7 B. & C. 443; 1 M. & (u) 6 Taunt. 65; 4 Campb. 119. Geo. 4 c. 94; 7 T. 137; Chit. Col. of Statutes, 876, note, tit. Set-off." (a) 4 B. & C. 547; 7 D. & R. 42, S. C. (b) 3 Burr. 420, 1230; 4 Id. 2220; Montague on Set-off, 1 to 3, 15. (c) This is entituled "An Act for the Relief of Debtors with respect to the Relief of their person." It is singular that the impor tant provisions in this and the following act respecting set-off should be introduced in statutes in all other respects relating only to insolvent debtors. upon such general issue." OFSET-O. F This clause was made perpetual by 8 Geo. 2, vII. PLEAS c. 24, s. 4; and it having been doubted whether mutual debts of a different nature could be set against each other (d), it was by the last-mentioned statute (e) further declared," that by virtue of the said clause mutual debts may be set against each other, either by being pleaded in bar or given in evidence under the general issue, in the manner therein mentioned, notwithstanding that such debts are deemed in law to be of a different nature, unless in cases where either of the said debts shall accrue by reason of a penalty contained in any bond or specialty, and in all cases where either the debt for which the action hath been or shall be brought, or the debt intended to be set against the same hath accrued or shall accrue by reason of any such penalty, the debt intended to be set off shall be pleaded in bar, in which plea shall be shown how much is truly and justly due on either side and in case the plaintiff shall recover in any such action or [ *571 ] suit, judgment shall be entered for no more than shall appear to be truly and justly due to the plaintiff after one debt being set against the other as aforesaid." : These statutes were passed for the benefit of defendants, and they are not imperative, so that a defendant may waive his right to set off, and bring a cross action for the debt due to him from the plaintiff (f) (1); and where he is not prepared at the time the plaintiff sues him to prove his cross demand, it is most advisable not to plead or give notice of set-off, for in case he should go into evidence upon the trial in support of his cross demand, and fail in the attempt, he cannot afterwards proceed in a cross action for the amount; and a party cannot bring an action for money which he has succeeded in setting off in a former action against him, although, if the set-off were more than sufficient to cover the plaintiff's demand in the former action, the defendant therein may maintain an action for the surplus (g). set-off. The principal rules upon the subject of set-off may perhaps be here The rules concisely alluded to with propriety. The statutes require, 1st, That the respecting debt sued for, and that sought to be set off, should be mutual debts, and due to each of the parties respectively in the same right or character (h); so that a joint debt cannot, by virtue of the statutes, and in the absence of an express agreement to that effect, be set off against a separate demand, nor a separate debt against a joint one (i) (2); but a debt due to a defendant as surviving partner may be set off against a demand on him in his own & P. 502; 4 Bing. 573, S. C. In actions by (i) 5 M. & Sel. 439; 2 Taunt. 173; 4 note. (1) Carpenter v. Butterfield, 3 Johns. Cas. 146, aliter in New Jersey, Schenck v. Schenck, 5 Halst. 276; Vide Gilliat v. Lynch, 2 Leigh, 493. (2) Francis v. Rand. 7 Conn. 221. But see Crist. v. Brindle, 2 Rawle, 121, and Stewart v. Coulter, 12 Serg. & Rawle, 252, 445. OFSET OFF VII. PLEAS right, and vice versa (k) (1). Nor can there be any set-off at law or in equity if one of the debts be due to the party in his private right, and the other be claimable by his opponent in autre droit, that is, as assignee of a bankrupt, executor, &c. (1) (2). 2dly, With respect to the nature of the demands to be set-off against each other, it will be remarked, that the statutes speak only of mutual debts; consequently the demand of each party must be in the nature of a debt; so that a set-off is excluded in all actions ex delicto; and it cannot be admitted even in actions ex contractu, if the claim [*572] of either party be for uncertainty or unliquidated damages, as for *not delivering goods according to contract, &c. (m). But if the plaintiff declare specially in assumpsit, with the common counts, (as in assumpsit for not accounting, with a count for money had and received) and he might recover his whole demand, as well upon the common counts as upon the special count, the benefit of a set-off may be obtained upon the common count, and the plaintiff shall not be permitted to exclude it by professing to rely upon the special count only (n). It has been held that a debt of inferior degree cannot be set-off against one of higher degree, not even a bond against rent, because the latter is higher than the former (0).And 3dly, The debt attempted to be set-off must be completely due and in arrear at the time the action was commenced, not merely at the time of pleading (p); and it must at the former period, have been a legal and subsisting debt, and not barred by the statute of limitations (q), or satisfied in law in consequence of the debtor having been taken in execution upon a judgment by which it was recovered (r). But an attorney may set off his bill although it was not delivered a month before the commencement of the action; but it ought, if possible, to be delivered time enough to be taxed, and at least should be delivered sufficiently early to prevent the plaintiff from being taken by surprise at the trial (s). The pendency of an action for the debt set-off (t), or of a writ of error where the set-off is upon a judgment (u), will not however defeat the right. () 5 T. R. 493; 6 Id. 582; 2 T. R. 476. 180. (m) Cowp. 56, 57; 1 Bla. Rep. 394; Bul. N. P. 181; M'Clel. 198; 13 Price, 434; 5 B. & Ald. 92; 3 Campb. 329. In replerin, however, though a set-off cannot, in general, be pleaded to an avowry for rent, yet the plaintiff may plead in bar to an avowry or cognizance the payment of ground rent, (4 T. R. 511; 2 Bing. 54; 9 B. & C. 245; 4 M. & R. 193, S. C.;) or of an annuity charged upon the premises (6 Taunt. 524; 2 Marsh. 220,) or of land tax, &c. paid for the same, after the rent distrained for had become due, or whilst it was accruing, though any previous payment of land tax, &c. cannot be pleaded to an avowry for rent subsequently due; though it may be sued for, 1 B. & Ald. 123; 3 Moore, 278; 1 B. & B. 37; 3 B. & Ald. 516; 4 Moore, 431; 2 B. & B. 59; 2 Chit. Rep. 531; M'Clel. 622; 4 Bing. 11. (n) 4 Campb. 385; ante, 411, 553. (o) Per Denman, C. J. in Davis v. Gyde, 1 Harr. R. 52, citing Gage v. Acton, 1 Salk. 326, sed quære. (p) 3 T. R. 186; 1 Bing. 93; 7 Moore, 412 Braithwaite v. Colman, 4 Nev. & Man. 654; and see 8 Bar. & Cres. 11; 2 M. & R. 181, S. C. (9) Stra. 1271; Bul. N. P. 180; 1 C. & J. 1; 9 Geo. 4, c. 14, s. 4. (r) 5 M. & Sel. 103; sed vide 1 Taunt. 426; 1 M. & Sel. 696; East, 258. (s) Dougl. 115, 192; 1 Esp. Rep. 449; Montag. 36. (t) Burr. 1229; Peake Rep. 210; 3 T. R. 186; 4 East, 507. (u) 3 T. R. 188, notes; Dougl. 112; Montag. 36, sed vide 2 Hen. Bla. 327. (1) Lewis v. Culbertson, Ad'm. 11 Serg. & Rawle, 48. (2) But an action instituted by L. upon a single bill, payable to "L., executor of B.," is an action in his own right, to which a debt due form him may be pleaded, and proved as a set-off; and he cannot go into evidence of the consideration of the bill, to show that it was for a debt due B., in order to exclude the set-off as due in another right. Turner v. Plowden, 2 Gill & Johns. OF SET-OFF in cases of The Bankrupt Act (x) provides, that where there has been mutual credit VII. PLEAS given by the bankrupt and any other person, or where there *are mutual debts between the bankrupt and any other person, the commissioner shall Set-off, &c. state the account between them, and one debt or demand may be set against bankrupt another, notwithstanding any prior act of bankruptcy committed by such cy. bankrupt before the credit given to, or the debt contracted by him, and what shall appear due on either side on the balance of such account, and no more shall be claimed or paid on either side respectively, and every debt or demand hereby made payable against the estate of the bankrupt, may also be set off in manner aforesaid against such estate; provided that the person claiming the benefit of such set-off had not, when such credit was given, notice of an act of bankruptcy by such bankrupt committed. With respect to the mode by which the defendant should avail himself Mode of of a strict legal set-off, we have seen (y) that when either the debt sued setting off. for, or that which is the subject of the set-off, accrued by reason of a penally contained in any bond or specialty, the statute enacts that the debt intended to be set-off shall be pleaded in bar, and a notice of set-off is not then allowed. The plea in that case must show how much is truly due on either side, and the sum admitted in the plea to be due to the plaintiff is traversable, though laid under a videlicet (z); and therefore the plaintiff may, in such case, either take issue on the amount of the debt alleged to be due to himself, or may deny the defendant's set-off (a): and if the plaintiff reply that more was due on the bond than the sum named in the plea, and fail in proving that allegation, he will be non-suited (b). But in cases where neither the plaintiff's nor the defendant's debt accrued by reason of a penalty, the defendant has the election to plead, or give notice of his setoff. It has been said, that if at the time of the action brought, a larger sum is due from the plaintiff to the defendant, it is more proper to plead the set-off, but that where the sum intended to be set-off is less than that for which the action is brought, a notice of sct-off should be given (c); but the statutes of set-off do not seem to warrant this distinction. In general a notice of set-off is less expensive than a plea; but where the plaintiff in his replication must necessarily admit a part of the defendant's case (d), a plea is preferable; and a set-off is usually pleaded in country causes, to save the trouble and expense of proving the service of notice (e). *Where a set-off is not pursuant to the enactment pleaded, the stat- [ *574 ] (x) 6 Gco. 4, c. 16, s, 50. There are two modes of balancing an account in the case of bankruptcy; 1st, Upon an action at law; or, 2dly, By the Commissioners, who, by the above act, have jurisdiction to state the account without the assignees. It seems the chancellor will restrain any attempt to reopen the account by bringing an action after the commissioners have adjusted it, see 1 Ros. 395. See in general as to set-off and as to mutual credit, (which is more comprehensive than the word debt, in the statutes of set-off,) in cases of bankruptcy, Eden, 2d edit. 186 to 206; Chit Col. of Stat. 879, note (c); 9 B. & C. 738; 4 M. & R. 593, S. C. Mutual credit must, since Reg. Gen. Hil. T. 4 W. 4, be pleaded specially. (y) Ante, 570. (z) 3 T. R. 65; 6 Id, 460. (a) Holt, C. N. P. 293. See the forms, post, vol. iii. (b) Holt, C. N. P. 293. (c) Bul. N. P. 179; Tidd, 9th ed. 697; Montague, 41, ace Lawes on Assumpsit, 638, contra; 6 Bing. 734. (d) Thus, if it be apprehended that the statute of limitations constitutes an answer to the set-off, it may be judicious to plead instead of giving notice of set-off; because the plaintiff must specially reply the statute if he intends to rely thereon. See 1 C. & J. 1. And if the set-off were on a deed execut ted by plaintiff, the general replication nil debet, might be insufficient, and therefore in his replication the plaintiff would be compelled to admit the deed, or the existence of the debt accruing thereon. (e) Tidd, 9th ed. 667; 6 Esp. Rep. 52. Mode of setting off. VII. PLEAS ute (f) provides that the defendant's demand may be given in evidence 0. SET-OFF under the general issue so as at the time of pleading such plea, notice shall be given of the particular debt intended to be insisted upon by the defendant, and upon what account it became due. But as there is no general issue in an action on a specialty, and a plea of non est factum to an action of covenant on an indenture for non-payment of money only puts in issue the deed, such plea is not a general issue within the meaning of this act, and therefore in an action of covenant or debt on a deed, though no penalty be proceeded for, a set-off should be specially pleaded (g). And it seems that the statute confines the right to give notice of set-off to a case where the general issue is pleaded alone. At all events, such notice cannot be given where several pleas are pleaded (h). Semble set off and mutual The Reg. Gen. Hil. T. 4 W. 4,† Pleadings in Assumpsit, reg. 3, orders that "set-off and mutual credit must be pleaded;" and it has been supcredit now posed that this rule abolishes a notice of set-off (i). to be pleaded. The forms of plea and notices of set-off In cases of bankruptcy the accounts may be balanced either upon an action at law, or before the commissioners (k). And in an action at suit of assignees, a set-off or mutual credit might formerly be given in evidence under the general issue, without a plea or notice of set-off (1). But now since Reg. Gen. Hil. T. 4 W. 4,† each should be pleaded. And to an action by assignee for a debt due to the bankrupt, the defendant might have pleaded a tender as to part, and give evidence of a set-off as to the rest without a plea of set-off (m). But it has been observed, that the practice was to plead and give notice of set-off in an action at law in the case of bankruptcy, in the same manner as under the general statutes relating to set-off, and that practice seems to be just, because it apprizes the plaintiff, of the intended defence (n). In point of form the plea of set-off should not only contain all the requisites essential to the validity of other pleas in bar, but must of *course show that the debt is of a nature which entitles the defendant to set it off *575] against the plaintiff's claim (o); and must describe the debt intended to be set off with the same certainty as in a declaration for the like demand (p). With respect to notices of set-off, it has been observed, "that they should be almost as certain as declarations;" (q) and therefore when the notice of (f) 2 Geo. 2. c. 22, s. 13. (g) 1 Starkic, 311; 5 M. & Sel. 164; 2 Chit. Rep. 388, S. C.; Selw. N. P. 6th edit. 535, acc.; but sce Bul. N. P. 181; Barnes, 191. (h) R. & M. 413; 2 C. & P. 310, S. C.; 6 Esp. Rep. 50; Duncan v. Grant, 1 Cr. M. & Ros. 383, S. P.; 4 Tyr. 318, 818; 2 Dowl. 683, S. C. (i) Bosanquet's Rules, 52, note 50; Duncan v. Grant, 1 Crom. M. & Ros. 283; 2 Dowl. 683; 4 Tyr. 816, S. C. Sed quære, the notice of set-off was given by statute, and Reg. Gen. Hil. T. 4 W. 4, contains no express regulation to take it away. (k) Ante, 57 v; Id. note (x). (2) 1 T. R. 115, 116; 6 Id. 58, 59; Monta + See American Editor's Preface. |